Fastfood company McDonald’s Japan has posted its first annual loss since 1973 but said it would turn a profit in 2003 after closures of underperforming stores.

The company reported a 2002 net loss of ¥2.34bn (US$19.4m) on revenue of ¥320.71bn, hit by a slumping Japanese economy and an outbreak of mad cow disease, as well as a special loss of ¥4.9bn for the closure of 176 stores this year.

In 2001, McDonald’s Japan reported net profit of ¥10.2bn on sales of ¥362bn.

In 2002 same-store revenues, which have been in decline for 16 straight months since mad cow disease was first confirmed in Japan, dropped 12.1%.

McDonald’s Japan, which is 50% owned by US fastfood giant McDonald’s, plans to invest around ¥10bn in the refurbishment of up to 300 outlets in 2003. It hopes to achieve same-store sales growth of 4.7% in 2003, reported Reuters.